Two rocket-propelled grenades hit a major ruling party building in Damascus on Sunday, residents said, in the first insurgent attack reported inside the Syrian capital during an eight-month-old uprising against President Bashar al-Assad.

An Arab League deadline for Syria to end its repression of unrest passed with no sign of violence abating and Assad said he had no choice but to pursue his military crackdown on street protesters, who seek an end to 41 years of Assad family rule.

The conflict will continue and the pressure to subjugate Syria will continue. Syria will not bow down, the president told Britain's Sunday Times newspaper in an interview.

The only way is to search for the armed people, chase the armed gangs, prevent the entry of arms and weapons from neighbouring countries, prevent sabotage and enforce law and order, he said in video footage on the newspaper's web site.

Assad said there would be elections in February or March when Syrians would vote for a parliament to create a new constitution and that would include provision for a presidential ballot.

The Syrian Free Army, comprising army defectors and based in neighbouring Turkey, claimed responsibility for the attack on the Baath Party building in Damascus.

Security police blocked off the square where the Baath's Damascus branch is located. But I saw smoke rising from the building and fire trucks around it, said a witness who declined to be named.

The attack was just before dawn and the building was mostly empty. It seems to have been intended as a message to the regime, he said.

The attack could not be independently confirmed. The authorities have barred most independent journalists from entering the country during the revolt.

It was the second hit on a high profile target in a week, underscoring a growing opposition challenge to Assad - who blames armed terrorist acts for the unrest - from a nascent insurgency alongside mostly peaceful protests that have persisted despite the intensifying crackdown.

Assad, who inherited power from his father in 2000, is a member of the Alawite minority community, an offshoot of Shi'ite Islam that dominates the state, the army and security apparatus in the majority Sunni Muslim country of 20 million.

The Syrian Free Army said the attack was a response to the authorities' refusal to release tens of thousands of political prisoners and pull the military out of restive cities as stipulated by a plan agreed between the Arab League and Damascus.

DEADLINE DISREGARDED

The Arab League had set a Saturday deadline for Syria to comply with the plan and threatened sanctions if Assad failed to end the violence. The League, a group of Arab states, suspended Syria's membership in a surprise move last week.

Non-Arab Turkey, once an ally of Assad, is also taking an increasingly tough attitude to Damascus.

Turkish newspapers said on Saturday Ankara had contingency plans to create no-fly or buffer zones to protect civilians in neighbouring Syria if the bloodshed worsens.

It's almost certain that Bashar al-Assad's regime is going down, all the assessments are made based on this assumption. Foreign Ministry sources say that the sooner the regime goes down, the better for Turkey, one paper said.

The Syrian Observatory for Human Rights said security forces killed 16 civilians in raids and shootings on protesters on Saturday, including two at a funeral in Kfar Tkharim in the northwestern province of Idlib on the border with Turkey.

Syrian authorities blame the violence on foreign-backed armed groups which they say have killed some 1,100 soldiers and police. By a United Nations account, some 3,500 people have been killed in the unrest.

Activists in the central city of Homs said the body of Farzat Jarban, an activist who had been filming and broadcasting pro-democracy rallies there, was found dumped near a private hospital on Saturday with two bullet wounds.

Security police are no longer just shooting protesters, they are targeting activists when they least suspect it, such as when they take their children to school. Sometimes they don't shoot to kill but to neutralise, said a doctor from Homs who has fled to Jordan.

I treated an activist recently...They shot him in the thigh and by the time his family got him to me gangrene had spread and his leg needed to be amputated, he said.

Tanks and troops deployed in Homs after large anti-Assad protests six months ago. The authorities say they have since arrested tens of terrorists in the city who have been killing civilians and planting bombs in public places.

Dissident colonel Riad al-Asaad, organising defectors in Syria from his new base in southern Turkey, denied government allegations that adjacent states were allowing arms smuggling into Syria. Not a single bullet had been smuggled from abroad, he told al Jazeera television.

Weapons were brought by defectors, obtained in raids on the regular army or bought from arms dealers inside Syria, he said.

Asaad said no foreign military intervention was needed other than providing a no-fly zone and weapons supplies, and that more deserters would swell his Free Syrian Army's ranks if there were protected zones to which they could flee.

Soldiers and officers in the army are waiting for the right opportunity, he told al Jazeera.

Opposition sources said a Syrian Free Army assault on an Air Force Intelligence Complex in a Damascus suburb two days ago killed or wounded at least 20 security police. Official media did not mention the raid.

(Additional reporting by Erika Solomon in Beirut; Editing by Mark Heinrich)